US LEI falls again in March, signalling slower growth ahead: TCB

“The US LEI for March pointed to slowing economic activity ahead,” said Justyna Zabinska-La Monica, senior manager, business cycle indicators, at The Conference Board. “March’s decline was concentrated among three components that weakened amid soaring economic uncertainty ahead of pending tariff announcements: 1) consumer expectations dropped further, 2) stock prices recorded their largest monthly decline since September 2022, and 3) new orders in manufacturing softened.”

“That said, the data does not suggest that a recession has begun or is about to start. Still, the Conference Board downwardly revised our US GDP growth forecast for 2025 to 1.6 per cent, which is somewhat below the economy’s potential. The slower projected growth rate reflects the impact of deepening trade wars, which may result in higher inflation, supply chain disruptions, less investing and spending, and a weaker labour market,” Zabinska-La Monica added.

The Conference Board Coincident Economic Index (CEI) for the US increased by 0.1 per cent in March 2025 to 114.4 (2016=100), after a 0.3 per cent increase in February. The CEI rose by 0.8 per cent over the six-month period between September 2024 and March 2025, up slightly from its 0.7 per cent growth over the previous six months, TCB said in a press release.

The CEI’s four component indicators—payroll employment, personal income less transfer payments, manufacturing and trade sales, and industrial production—are included among the data used to determine recessions in the US. Industrial production, which has declined for the first time since November of 2024, was the only negative contributor in March.

The Conference Board Lagging Economic Index (LAG) for the US decreased by 0.1 per cent to 119.1 (2016=100) in March 2025, after a 0.3 per cent increase in February. Despite the monthly downtick, the LAG’s six-month growth rate remained positive at 0.7 per cent between September 2024 and March 2025—a reversal of its –0.7 per cent decline over the previous six months (March–September 2024).

LEI provides an early indication of significant turning points in the business cycle and where the economy is heading in the near term, while CEI provides an indication of the current state of the economy.

ALCHEMPro News Desk (KD)